On November 27, New Mexico Attorney General Hector Balderas joined the ranks of amici curiae in Consumer Financial Protection Bureau v. Golden Valley Lending, Inc., et al. (No. 2:17-cv-02521, pending in the United States District Court for the District of Kansas) filing a brief supporting the efforts of four tribal entities ("Tribal Defendants") to dismiss claims brought against them by the Consumer Financial Protection Bureau.
In filing the amicus brief, Balderas voiced support for the Tribal Defendants' argument that, as tribal entities, they are not subject to the CFPB's enforcement authority: "In this and other actions, [the CFPB] has asserted the authority to regulate other sovereigns—both States and Tribes—when providing financial services to consumers."
The amicus brief argues that the CFPB's position is flawed because the Consumer Financial Protection Act of 2010 does not clearly subject states or tribes to enforcement. The brief also notes that the CFPB's position would lead to anomalous results. While the Act anticipates regulatory coordination among the CFPB, states, and tribes, by attempting to enforce the Act against a tribal entity, the CFPB attempts to treat its co-regulator as a regulated entity.
Balderas also points out the sweeping consequences of the CFPB's position for the State: "[T]he CFPB asks to both be allowed to sue sovereign entities for money damages (including civil penalties) and injunctive relief, ... and to force state and tribal officials to testify and create records for federal investigations ... ." As specifically concerns the State, "New Mexico has numerous government programs, such as the student loans issued by its universities and the lending assistance offered by the New Mexico Finance Authority and the New Mexico Mortgage Finance Authority, that are subject to suit—and even injunction—under the CFPB's interpretation."
With this filing, Balderas becomes the second attorney general to submit his views on the litigation. As earlier noted on this blog, Oklahoma Attorney General Mike Hunter also filed an amicus brief in support of the Tribal Defendants' motion to dismiss. All other amici to weigh in on the case have supported the Tribal Defendants.
Further briefing on the motion to dismiss is expected from the parties. We will continue to monitor the case for further developments.
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